Foreign ownership sparks opposition

“Last year we said things couldn’t go on like this. And they didn't — they got worse,” Will Rogers once joked.

By Candace KrebsContributing Writer

STERLING, Colo. — “Last year we said things couldn’t go on like this. And they didn't — they got worse,” Will Rogers once joked.

Wil Bledsoe, a rancher from Hugo, could have been channeling the cowboy humorist recently when asked to revisit concerns he expressed last summer about rising levels of imported meat and livestock.

“I think we keep losing ground instead of gaining ground, and the drought just expedited the process,” he said.

Pending a vote by the membership, Bledsoe is expected to become president of the Colorado Independent Cattle Growers Association sometime in September.

In May, Smithfield Foods, the nation’s largest pork processor, re-ignited the debate over foreign ownership of meat production and processing after announcing intentions to merge with a Chinese company. The move requires federal approval.

Among those scrutinizing the deal is Senate Agriculture Committee chairman Debbie Stabenow of Michigan. R-CALF USA and the National Farmers Union are two prominent groups actively opposing it.

Questions have been raised about whether the deal would compromise U.S. food safety standards or national security interests. While China is the largest pork consumer in the world and is looking for a way to satisfy growing internal demand, there are fears the merger could create a conduit for lower-cost meat from a Communist country with questionable environmental and humanitarian standards.

The term “too-big-to-fail” was coined in 2007 to describe mega-banks that were deemed too important not to bail out by the federal government. But when the Brazilian firm JBS bought Swift and Company of Greeley in 2009 — gaining control of several of the country’s largest feedyards through its Five Rivers Cattle Feeding subsidiary — it created a foreign-owned company with practically no way to fail, Bledsoe said.

“Most people don’t realize that the Brazilian government actually owns 40 percent of JBS,” he said.

That means locally owned feeders and processors are competing in the market against a foreign government with very deep pockets — deep enough to outlast any downturn and continually increase their already powerful presence in the domestic meat business, he said.

Tom Robb, a rancher from McClave, Colo., is also concerned about the issue.“We’re not going to have a meatpacker left that’s American-owned before long,” he said.

Hot debate over COOLThese cattlemen and others like them have sought at least a partial remedy to their concerns by pushing country of origin labeling law. They consider it essential to differentiating what they produce at the meat counter and giving consumers a clear choice for supporting American ranchers.

Robb says he’s been riled up ever since the National Cattlemen’s Beef Association filed a lawsuit earlier this summer to halt implementation of mandatory COOL. Several groups are now attempting to intervene in that lawsuit.

First passed into law as part of the 2002 Farm Bill, country of origin labeling was controversial from the start and generated a backlash from cattle producers in Canada and Mexico that depend heavily on the U.S. market. They’ve since threatened trade retaliation.

The ongoing squabble has deeply divided the cattle industry.

Robb said he doesn’t fault the NCBA for taking a position on COOL, even if it’s contrary to his own, but he fiercely opposes the lawsuit. Since NCBA derives roughly 80 percent of its annual budget from administering contracts for the beef check-off, which is paid by all producers, Robb considers it indirectly a waste of his own money.

Opponents of increased globalization also supported proposed Grain Inspection, Packers and Stockyards Administration rule modifications, published in 2011 and debated at federal hearings in Fort Collins and elsewhere. But that proposal led to a political firestorm and most of the suggestions were dropped without ever being adopted.

Gerald Schreiber of Woodrow, the current CICA president, attributes the failed effort in part to over-reach by other government agencies like the Environmental Protection Agency and the U.S. Bureau of Labor.

“Everyone is just paranoid at this point about having more government in our business,” he said.

But, he added, some laws are necessary to keep businesses honest and to protect national interests.

While it’s widely assumed that U.S. ranchers will rebuild their cow numbers at some point, it isn’t a sure thing. Last year Bledsoe’s family fed six times more hay than normal and paid three times the price for it. With losses like that, any financial recovery will be slow and cautious, even with the nation’s cowherd at a 61-year low and ranchers poised to be in the driver’s seat, Bledsoe said.

“To double our cowherd nationally will take at least five to 10 years,” he predicted.In the meantime, the industry will be under pressure to import more cattle.

“They are going to keep coming in, if we keep losing cattle numbers,” said Curt Werner, another rancher from Merino, Colo.

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